Naresh Kumar Sharma & Ors vs Oriental Bank Of Commerce & Anr
- CitationCompany Appeal (AT) (Insolvency) No. 953 of 2019
Ratio decidendi
The rule this decision rests on
Where a corporate debtor's Information Memorandum, prepared by the Interim Resolution Professional and made public for prospective resolution applicants, contains the financial details of the corporate debtor, a promoter who has not sought that information from the Interim Resolution Professional and raised objection to the Information Memorandum before the Adjudicating Authority under Section 60(5) of the Insolvency and Bankruptcy Code cannot later obtain a direction for disclosure of such details on the ground of a dispute over valuation, particularly where the resolution plan has already been provided to him. Where a promoter's non-cooperation with the Insolvency Resolution Professional after initiation of the corporate insolvency resolution process has caused delay, the promoter cannot rely on any resulting infirmity in the process to seek relief, as such infirmity is attributable to the promoter's own conduct. Under the Insolvency and Bankruptcy Code, where facts relating to the corporate debtor's financial details or valuation have been noticed by the Committee of Creditors and the promoter has no objection, any objection must be brought to the notice of the Adjudicating Authority, which may then examine the financial details of the corporate debtor in respect of hotel operations and the valuation report.
Written by Miss Lucy from the judgment below, not taken from a headnote.
Judgment
As delivered
Naresh Kumar Sharma & Ors. ...Appellants
Versus
Oriental Bank of Commerce & Anr. ...Respondents Present: For Appellant : Mr. Virender Ganda, Senior Advocate with Mr. Rakesh Kumar, Mr. Dhruv Gupta, Mr. Ayandeb Mitra and Mr. Anand Singh Sengar, Advocates
For Respondents : Mr. Shashank and Ms. Richa, Advocates for 'OBC Bank' Mr. Abhishek Anand, Advocate for 'Resolution Professional' ORDER
16.09.2019 The Appellant/Promoter filed an application under Section
60(5) of the 'I&B Code' seeking direction TO the 'Resolution Professional' to
provide financial details of the 'Corporate Debtor' with respect to the hotel
operation and necessary details with regard to the 'valuation report'. The
Adjudicating Authority (National Company Law Tribunal), New Delhi by
impugned order dated 26th August, 2019 dismissed the application.
Learned counsel appearing on behalf of the Appellant submits that the
aforesaid details are required for valuation of the properties which is Rs. 432
Crores, whereas the 'resolution plan' shows that the 'valuation' of the property
is Rs. 143 Crores. However, as we find that the 'resolution plan' has already
been provided to the Appellant/Promoter, we are not inclined to interfere with
the impugned order dated 26th August, 2019 for the following reasons:
The 'Information-Memorandum' was prepared by the 'Interim Resolution
Professional' and was published allowing the 'Resolution Applicant' to submit 2
an 'Expression of Interest' followed by the 'resolution plan'. As the Information-
Memorandum' contained all the details, including the financial details of the
'Corporate Debtor', it was open to the Appellant to go through the Information
Memorandum, which was made public. There is nothing on record to suggest
that the Appellant/Promoter approached the 'Interim Resolution Professional'
and sought for the information and if so, objection was raised by the 'Promoter'
against the 'Information-Memorandum', which contains the financial details of
the 'Corporate Debtor', by filing an application under sub-section (5) of Section
60. On the other hand the record shows that after initiation of 'corporate
insolvency resolution process', the 'Promoters' were not cooperating with the
'Insolvency Resolution Professional which causes delay. For the said reason, if
any infirmity is found, 'Promoters' can blame themselves.
In view of the provisions of the 'I&B Code', it is expected that as far as the
facts have been noticed by the 'Committee of Creditors', if no objection is there
by the Appellant, he may bring the same to the notice of the Adjudicating
Authority who in its turn can check the financial details of the 'Corporate Debtor'
in respect of the hotel operations and valuation report.
The appeal stands disposed of with aforesaid observations.
[Justice S.J. Mukhopadhaya] Chairperson
[ Justice A.I.S. Cheema ] Member (Judicial)
[ Kanthi Narahari ] Member (Technical) /ns/gc
Company Appeal (AT) (Insolvency) No. 953 of 2019
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